IG Markets increases bank margins to 10%

I noted with some interest that IG Markets has upped margin rates on banks from 5% to 10% recently. The stated reason is increased volatility.

The cynic in me says that this actually means more CFD punters are blowing themselves up using the banks and IG Markets are having trouble collecting their winnings (or are anticipating this scenario) - increasing the % margin will decrease the size of the blow-ups.

MichaelD said:

- increasing the % margin will decrease the size of the blow-ups.

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And the speed of the blow up but MM are patient. They always get their man

To IG's credit, they forewarned these changes. MF Global upped these margins a while ago, with no forewarning.

MichaelD said:

I noted with some interest that IG Markets has upped margin rates on banks from 5% to 10% recently. The stated reason is increased volatility.

The cynic in me says that this actually means more CFD punters are blowing themselves up using the banks and IG Markets are having trouble collecting their winnings (or are anticipating this scenario) - increasing the % margin will decrease the size of the blow-ups.

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No trickery here they are just protecting themselves in the current market.

leading on the banks would have really tightened up now!

have been asked via a PM about IG ... I don't know anything about their financial state but they are one of the mobs I trade with... in the current climate rumours usually come before a fall... and with IG i keep an interested eye on their S/P for any signs.... at least being listed means a little bit of the opaqueness is necessarily lifted... unlike some others.. however, anything can happen at anytime to anyone.. so I guess it is buyer beware.. and only keep the funds required for immediate trading exposed

Hope this is of some help..
Cheers
...........Kauri